Less than a month after striking a $1.8 billion portfolio deal, alternative investment giant Blackstone has inked another $1 billion-plus real estate transaction through its core-plus fund.
The New York-based firm is buying a portfolio of western US logistics centers for $1.5 billion from LBA Realty, an Irvine, California-based real estate investor.
The firm, which declined to comment, has gone into contract to acquire the 12 million square foot portfolio, the Wall Street Journal first reported. The purchase would mark the largest US industrial real transaction so far this year, according to real estate data provider Real Capital Analytics.
PERE understands that capital for the purchase came from Blackstone’s core-plus fund, Blackstone Property Partners (BPP). With capital from the vehicle, the firm also recently purchased a 50 percent interest in a Miami industrial real estate property for about $250 million from AEW Capital.
Blackstone’s portfolio purchase comes as a number of sizable US industrial real estate portfolios have hit the market. Last week, Singapore-based logistics fund manager GLP announced it had agreed to acquire a $1.1 billion, 32-property logistics real estate portfolio from Dallas-based Hillwood Development Company. Alternative investment manager TPG is marketing a 150-asset industrial real estate portfolio with bids that could reach $1.1 billion.
Blackstone is still looking to offload its European logistics arm, Logicor. The sale of the platform could be one of the biggest-ever initial public offerings or industrial sales in European real estate, with a transaction that could value the platform, including debt, at €11 billion, PERE previously reported.
The firm set a record for the largest-ever industrial real estate transaction with the 2014 disposition of its US industrial real estate business, IndCor, which Singapore’s sovereign wealth fund purchased for $8.1 billion. Blackstone formed the platform in 2010 with capital from two of its opportunistic funds, Blackstone Real Estate Partners VI and Blackstone Real Estate Partners VII.
The deal with LBA Realty is the latest in a recent string of purchases for Blackstone from its open-ended core-plus fund. Last month, PERE reported that the firm, which manages $103.2 billion in real estate assets, was finalizing a $620 million deal to buy Kips Bay Court, an 894-unit New York apartment complex. In August, the firm also purchased Swedish pension fund Alecta’s US assets in a $1.8 billion deal.
BPP had $11.9 billion in committed capital and a 15 percent net internal rate of return as of June 30, according to the firm’s second-quarter earnings. One of the largest limited partners in the fund is California State Teachers’ Retirement System, which committed $500 million to the vehicle, according to PERE research.